The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which went into effect on March 27, 2020, provides for the Federal Pandemic Unemployment Compensation (“FPUC”) and Pandemic Unemployment Assistance (“PUA”) programs, which in turn, provide emergency unemployment assistance due to COVID-19 related circumstances.

Federal Pandemic Unemployment Compensation (FPUC)

The U.S. Department of Labor (“DOL”) has issued guidance on the FPUC program, through which states will administer an additional $600 weekly payment through July 31, 2020 to eligible individuals who are receiving regular state unemployment benefits. 

Under the FPUC program, if an individual is eligible to receive at least a nominal amount of regular unemployment compensation for a workweek, he or she is also eligible to receive the $600 payment. Individuals who are partially unemployed and whose earnings for the week exceed the state’s weekly benefit amount ($450 in California) would receive $0 in regular unemployment benefits for that week (and also miss out on the additional $600).

For employers that want to avoid this outcome, it may be better for employees not to work at all to ensure that they receive regular unemployment and the additional $600. Or, employers could reduce employee hours to the extent required for the employee’s earnings to fall below the weekly benefit amount. Finally, an employer could apply for the state work share program through which the employee could receive partial wages and partial regular unemployment, plus the $600. California offers a Work Sharing Program through the Economic Development Department (“EDD”).

The benefits payments under the FPUC program can begin as soon as the week after the execution of a signed agreement between the federal government and states. California signed the agreement on April 11, 2020 and eligible Californians impacted by the pandemic began receiving the $600 weekly additional FPUC payments on April 14, 2020.

Pandemic Unemployment Assistance (PUA)

Also provided for under the CARES Act, the PUA program is a temporary federal program that provides up to 39 weeks of unemployment benefits for certain individuals impacted by the pandemic.[1] The PUA program extends benefits that are distinct from traditional unemployment to individuals who are out of work or partially unemployed due to COVID-19. Eligible individuals include those who are self-employed, who lack sufficient work history, and independent contractors (including gig workers).  People who receive PUA benefits can also receive the $600 weekly benefit amount under the FPUC program.

The California EDD is currently creating a system to allow individuals to apply for unemployment and PUA benefits. Individuals will be able to self-certify online through the EDD that they meet the COVID-19 related criteria for PUA. The PUA benefits are retroactive to the time before the CARES Act was passed. In other words, once individuals apply and are approved, they will receive PUA benefits dating from the first full week of February if their inability to work was COVID-19 related. Once set up, this system will be able to pay individuals within 24 to 48 hours of their application. The EDD anticipates that setting up the system will be complete by the last week of April 2020.

Individuals who are offered the option to continue to work for pay by teleworking are not eligible for PUA. Likewise, workers who have a right to paid leave benefits, even if they are otherwise eligible for PUA, cannot collect PUA.

[1] PUA benefits can cover people unemployed or partially unemployed from January 27, 2020 through December 31, 2020 depending on the date of actual impact. The $600 per week additional payments is added to unemployment benefits for the weeks they are unemployed from March 29 until July 31, 2020.

Author: Caitie Emmett, Associate.

The Maier Law Group helps companies ensure that their policies and practices comply with the relevant workplace regulations.  Please contact us at info@maierlawgroup.com for more information.

This article has been prepared for general informational purposes only and does not constitute advertising, solicitation, or legal advice. If you have questions about a particular matter, please contact the Maier Law Group directly.